I think the writing is on the wall for Openreach. People might argue against it but it is quite understandable that people think that Openreach and BT act as one. After all, even if they don't, they both have the same parent company. You really trying to tell me that they don't ever talk to one another on the next up and coming advance.
The common charge levelled at BT Group is that as a vertically-combined business, it can afford to run its end-user-facing subsidiaries (BT Retail, BT Business, and Plusnet) at minimal profit, or even at no profit at all. In the knowledge that those losses are counterbalanced by the huge profits the BT Group makes out of Openreach, from all Comms Providers.
That (alleged) cross-subsidy of BT's business has for years been the issue-of-contention with Ofcom and other Communication Providers. The relative demise of DSL via Local Loop Unbundling (LLU) has only accelerated and aggravated that lack of competition.
As for the consequences of hiving off Openreach, not much different from National Grid. Has the electricity supply fallen over yet since that happened. Nope. You'd get the same result with Openreach being on its own. Shareholders can be a pain, they can be a blessing but given the recent report that too much money (percentage wise) is being paid out to shareholders generally by a lot of companies with investment suffering as a result, maybe a break up wouldn't be such a bad idea.
Yes, we should comparison Openreach with the stand-alone networks of National Grid and Network Rail. We don't expect rivals to build overlay network in those two examples, to create competition; the expense and disruption would be enormous. The telecom network really isn't very different. If anything, of those three networks, Rail, Electricity and Telecoms, Openreach is best-placed for public ownership.
And someone mentioned that the old PO setup used to take weeks to do anything. Even Openreach took over 6 months to get my phone line reconnected. Reason? Lack of infrastructure investment at the local level. And of course, millions of £££ have been paid out from Government sources via BDUK to pay for the upgrades in many places around the UK. Even though fibre hasn't quite got here (they put the cabinet in place last week) I do know that if the government (and the EU) hadn't coughed up the money, we'd still be waiting for some sort of modernisation of anything if Openreach/BT had their way. Sometimes to have to lose money to make it.
The current setup has had its day.
The status quo certainly is a broken business model. We have a heavily state-subsidised telecommunications network that is not giving value for money, and no delivering for millions of households. It has long been the case that Openreach has (allegedly) been overcharging the taxpayer for its BDUK contract work, mindful that there's always more cash in the public kitty. Why hurry, when it's almost unaccountable public cash? The taxpayer-subsidised plant (DSLAMs, cabinets, new fibre) after just a few years becomes entirely BT's property. That is ridiculous and should not continue.
Pages in this thread: 
Print Thread
RobertoS
